LOAN SUBSCRIPTION
AGREEMENT
Exhibit 10.61
TO: VOICE MOBILITY INTERNATIONAL, INC.
Xxxxx 000, 0000 Xxxxxxxx Xxxxxxx
Xxxxxxx, X.X. X0X 0X0
RE: Convertible Promissory Note
Details of Subscription
The undersigned subscriber (the
“Lender”) agrees to pay to Voice Mobility International, Inc. (the
“Company”), subject to the terms and conditions set out in Schedule
“A” hereto, the aggregate amount of Cdn.$150,075 (the “Loan Funds”)
and agrees to purchase a convertible note (the “Note”) for the Company for the
aggregate amount of the Loan Funds.
EXECUTION BY LENDER
Leede Financial Markets Inc in trust for Xxxxxxx X.
Signature of Individual Lender or Xxxxx RRSP#074-0470-S
Authorized Signatory of Lender Name of Lender
(if Lender is not an individual)
Xxxxxxx X. Xxxxx
Name(s) of Beneficial Owner(s)
0000 00xx Xxx X.X., Xxxxxx Xxx, XX, X0X 0X0
Signature of Witness Address of Lender
Print/Type Name of Witness
Promissory Note in the principal amount of: Name of Contact Person, if Lender not an individual
Cdn. $150,075
000-000-0000
Telephone Number of Lender or Contact Person
000-000-0000
Facsimile Number of Lender or Contact Person
Executed by the Lender
this __________ day of _________________, 2004.
ACCEPTANCE
The foregoing is accepted by the
Company as of the ____ day of _______________, 2004.
VOICE MOBILITY INTERNATIONAL, INC.
Per:
SCHEDULE “A”
In consideration of the covenants and
agreements herein, and the payment of one dollar made by each party to the other, the
receipt and sufficiency of which is acknowledged by each party, the parties agree as
follows:
1. Terms of the Offering
1.1 Note. The Company will
issue to the Lender the Note, in the form attached hereto as Schedule “C”, for
the aggregate amount of the Loan Funds, such Note to have an annual coupon rate of eight
percent, payable quarterly, convertible at the option of the Lender at any time before the
date that this is two years from the Closing Date into units (the “Units”) at a
price of Cdn$1.15 per unit, pursuant to which each Unit will consist of one common share
of the Company (the “Note Shares”) and one non-transferable common share
purchase warrant (the “Warrants”). One Warrant shall entitle the Lender, upon
giving 61 days notice to the Company, to purchase one common share of the Company (the
“Warrant Shares”) at a price of Cdn.$1.15 per common share for a period of two
years from the Closing Date. (The Note, the Note Shares, the Warrants and the Warrant
Shares, collectively referred to herein as the “Securities”)
1.2 Acceptance by the Company of
Offer to Purchase. The acceptance by the Company of the Lender’s irrevocable
subscription to purchase the Note as contemplated by this Agreement shall constitute an
agreement by the Company with the Lender that the Lender shall have, in respect of such
Note, the benefits of the representations, warranties and covenants of the Company
contained in the Agreement.
1.3 Security and Priority. As
security for the obligations of the Company to the Lender, the Company shall make all
reasonable efforts to cause Voice Mobility Inc. (the “Guarantor”) to execute and
deliver to the Lender a General Security Agreement on the assets of the Guarantor. The
Company’s repayment obligations under the Note shall rank prior to all indebtedness
of the Company, other than the existing registered charges and security interests listed
in Schedule “F”.
1.4 Guarantee. In the event
that the Company does not pay the amount owing under the Note to the Lender when due, or
on demand of the Lender ,where the Lender is permitted to make such demand, the Lender
will make demand of Voice Mobility Inc. (the “Guarantor”) under an agreement to
be entered into between the Company and the Guarantor (the “Guarantee
Agreement”) to pay to the Lender any amounts owing under the Note.
2. Representations and
Warranties
2.1 The Lender represents and
warrants to the Company, and acknowledges that the Company is relying on these
representations and warranties to, among other things, ensure that it is complying with
the appropriate exemptions (the “Exemptions”) from the registration and
prospectus or equivalent requirements of all rules, policies, notices, orders and
legislation of any kind whatsoever (the “Securities Rules”), that:
| |
(a) |
the Lender is purchasing the Securities as principal for its own account and not
for the benefit of any other person; |
| |
(i) |
a
director, “senior officer” or “control person” of the
Corporation (as that term is defined in the Securities Act (British
Columbia) and set out in Schedule “D” to this Agreement) or
an “affiliate” of the Corporation (as that term is defined
in Schedule “D” to this Agreement); OR |
| |
(ii) |
a
spouse, parent, grandparent, brother, sister or child of a director, senior
officer or control person of the Corporation or of an affiliate of
the Corporation; OR |
| |
(iii) |
parent,
grandparent, brother, sister or child of the spouse of a director,
senior officer, or control person of the Corporation or an affiliate
of the Corporation; OR |
| |
(iv) |
a
close personal friend of a director, senior officer, or control person of the
Corporation or of an affiliate of the Corporation; OR |
| |
(v) |
a
close business associate of a director, senior officer, founder or control
person of the Corporation or of an affiliate of the Corporation; OR |
| |
(vi) |
a
“founder” of the Corporation (as that term is defined in
Multilateral Instrument 45-103 and set out in Schedule “D” to
this Agreement) or a spouse, parent, grandparent, brother, sister,
child, close personal friend or close business associate of a founder
of the Corporation; OR |
| |
(vii) |
a
parent, grandparent, brother, sister or child of the spouse of a founder of
the Corporation; OR |
| |
(viii) |
a
person or company of which a majority of the voting securities are
beneficially owned by, or a majority of the directors are persons or
companies described in subparagraphs (i) to (vii) above; OR |
| |
(ix) |
a
trust or estate or which all of the beneficiaries or a majority of the
trustees are persons or companies described in subparagraphs (i) to
(vii); OR |
| |
(x) |
an
“accredited investor” (as that term is defined in MI 45-103) and
set out in Schedule “D” to this Agreement; OR |
| |
(xi) |
purchasing
a sufficient number of Securities such that the aggregate acquisition
cost to the Lender of such Securities is not less than Cdn.$97,000,
and the Lender has not been formed, created, established or
incorporated for the purpose of permitting the purchase of the
Securities without a prospectus by groups of individuals whose
individual share of the aggregate acquisition cost for such
Securities is less than Cdn.$97,000; |
| |
(c) |
the Lender is not a “U.S. Person” (as defined under Regulation S made
under the United States Securities Act of 1933, which definition includes an
individual resident in the United States and an estate or trust of which any
executor or administrator or trustee, respectively, is a U. S. Person) and the
Lender understands and acknowledges that the Securities have not and will not be
registered under the United States Securities Act of 1933, and, subject to
certain exceptions, the Securities may not be offered or sold within the United
States; |
| |
(d) |
the Lender acknowledges that because this subscription is being made pursuant to
the Exemptions: |
| |
(i) |
the
Lender is restricted from using certain of the civil remedies available
under the applicable Securities Rules, |
| |
(ii) |
there
is no government or other insurance covering the Securities; |
| |
(iii) |
there
are risks associated with the purchase of the Securities; |
| |
(iv) |
there
are restrictions on the Lender’s ability to resell the Securities and
it is the responsibility of the Lender to find out what those
restrictions are and to comply with them before selling the
Securities; |
| |
(v) |
the
Lender may not receive information that might otherwise be required to be
provided to the Lender under the applicable Securities Rules if the
Exemptions were not being used, |
| |
(vi) |
the
Company is relieved from certain obligations that would otherwise apply
under the applicable Securities Rules if the Exemptions were not
being used; and |
| |
(vii) |
the
Lender understands that the Exemptions release the Company from the
requirements to provide the Lender with a prospectus and to sell
Securities through a person registered to sell securities under the
Securities Act (British Columbia) and, as a consequence of
acquiring Securities pursuant to those Exemptions, certain
protections, rights and remedies provided the Securities Act (British Columbia),
including statutory rights of rescission or damages, will not be
available to the Lender; |
| |
(e) |
the Securities are not being subscribed for by the Lender as a result of any
material information about the Company’s affairs that has not been publicly
disclosed; |
| |
(f) |
the offer and sale of these Securities was not accomplished by an advertisement
and the Lender was not induced to purchase these Securities as a result of any
advertisement made by the Company; and |
| |
(g) |
if the Lender is a corporation, the Lender is a valid and subsisting
corporation, has the necessary corporate capacity and authority to execute and
deliver this Agreement and to observe and perform its covenants and obligations
hereunder and has taken all necessary corporate action in respect thereof, or,
if the Lender is a partnership, syndicate, trust or other form of unincorporated
organization, the Lender has the necessary legal capacity and authority to
execute and deliver this Agreement and to observe and perform its covenants and
obligations hereunder and has obtained all necessary approvals in respect
thereof, and, in either case, upon the Company executing and delivering this
Agreement, this Agreement will constitute a legal, valid and binding contract of
the Lender enforceable against the Lender in accordance with its terms and
neither the agreement resulting from such acceptance nor the completion of the
transactions contemplated hereby conflicts with, or will conflict with, or
results, or will result, in a breach or violation of any law applicable to the
Lender, any constating documents of the Lender or any agreement to which the
Lender is a party or by which the Lender is bound. |
2.2 The Company represents and
warrants to the Lender, and acknowledges that the Lender is relying on these
representations and warranties in entering into this Agreement, that:
| |
(a) |
the Company is a valid and subsisting corporation duly incorporated and in good
standing under the laws of the jurisdiction in which it was incorporated,
continued or amalgamated; |
| |
(b) |
the Company is a reporting issuer in British Columbia, Alberta, Ontario, Quebec
and New Brunswick and the Company is not, to the best of its knowledge, in
material default of any of the requirements of the applicable Securities Rules
of those jurisdictions; |
| |
(c) |
the common shares of the Company are listed and posted for trading on The
Toronto Stock Exchange (the “TSX) and, to the best of its knowledge, the
Company is not in material default of any of the listing requirements of the
TSX; |
| |
(d) |
upon their issuance, the Note Shares will be validly issued and outstanding
fully paid and non-assessable common shares of the Company registered as
directed by the Lender, free and clear of all trade restrictions (except as may
be imposed by operation of the applicable Securities Rules) and, except as may
be created by the Lender, liens, charges or encumbrances of any kind whatsoever; |
| |
(e) |
upon their issuances, the Warrants will be validly created, issued and
outstanding warrants of the Company, registered as directed by the Lender, and,
upon their issuance, the Warrant Shares issued on the exercise of the Warrants
will be validly issued and outstanding fully paid and non-assessable common
shares of the Company registered as directed by the Lender, and both will be
free and clear of all trade restrictions (except as may be imposed by operation
of the applicable Securities Rules) and, except as may be created by the Lender,
liens, charges or encumbrances of any kind whatsoever; |
| |
(f) |
the Company has good and sufficient right and authority to enter into this
Agreement and complete its transactions contemplated under this Agreement on the
terms and conditions set forth herein; and |
| |
(g) |
to the best of its knowledge, the execution and delivery of this Agreement, the
performance of its obligations under this Agreement and the completion of its
transactions contemplated under this Agreement will not conflict with, or result
in the breach of or the acceleration of any indebtedness under, or constitute
default under, the constating documents of the Company or any indenture,
mortgage, agreement, lease, license or other instrument or any kind whatsoever
to which the Company is a party or by which it is bound, or any judgment or
order of any kind whatsoever or any Court or administrative body of any kind
whatsoever by which it is bound. |
3.Covenants,
Acknowledgements and Agreements
3.1 Concurrent with the
execution of this Agreement, the Lender will:
| |
(a) |
fully complete Schedule “B” to this Agreement and the Lender
acknowledges that the Company is relying on the Exemptions in order to complete
the trade and distribution of the Securities under the Exemptions and the Lender
is aware of the criteria of the Exemptions to be met by the Lender including the
representations contained in Schedule “B”; and |
| |
(b) |
fully complete and execute the TSX questionnaire appearing as Schedule
“E” to this Agreement. |
3.2 The Lender acknowledges and
agrees that the Note, the Note Shares comprising the Units, the Warrants comprising the
Units and any Warrant Shares acquired on the exercise of the Warrants will be subject to
such trade restrictions as may be imposed by operation of applicable Securities Rules, and
the certificates representing the Note Shares, Warrants and any Warrant Shares acquired on
the exercise of the Warrants will bear such legends as may be required by applicable
Securities Rules and by the rules and policies of the TSX. The Lender further acknowledges
and agrees that it is the Lender’s obligation to comply with the trade restrictions
in all of the applicable jurisdictions and the Lender’s obligation to comply with the
trade restrictions except as provided for herein. In this regard, the Lender acknowledges
that such trade restrictions provide that the Lender must hold and not sell, transfer or
in any manner dispose (collectively, the “Disposition”) of the Note, the Note
Shares, Warrants or any Warrant Shares acquired on the exercise of the Warrants in British
Columbia prior to midnight on the four month anniversary of the Closing Date, unless the
Lender has obtained the prior written consent of the TSX to the Disposition and unless the
Disposition is made in accordance with all applicable Securities Rules. The Lender further
acknowledges to the Company that this paragraph 3.2 constitutes sufficient notice of the
applicable hold periods.
3.3 The Lender acknowledges that no
securities commission has evaluated or endorsed the merits of these Securities and that
the person selling these Securities has no duty to tell the Lender whether these
Securities are a suitable investment. The Lender further acknowledges that it is investing
in the Company entirely at its own risk and it may lose all of the Loan Funds.
4. U.S. Requirements
4.1 This Offering is limited to
subscribers who are “Accredited Investors,” as defined in Rule 501 of Regulation
D under the U.S. Securities Act of 1933 (the “U.S. Securities Act”). An
Accredited Investor is one who meets any of the requirements set forth below. In order to
establish the qualification of the Lender to invest in the Securities, the information in
paragraph G of Schedule “B” below must be supplied.
4.2 The Lender represents and
warrants to the Company that the Lender falls within the category or categories marked in
paragraph G of Schedule “B”.
4.3 If and only if the Lender is
resident in the U.S., then the Lender further acknowledges and agrees that the Securities
(and any underlying securities which those Securities are convertible into) are
“restricted securities” within the meaning of the U.S. Securities Act (and
applicable state securities laws) and may not be sold or transferred in the U.S. unless
they are subsequently registered under the U.S. Securities Act or any exemption from such
registration is available and the certificates representing the Securities will bear a
legend to reflect these restrictions. The Lender understands and agrees that upon the
original issuance of the Securities (and any underlying securities which those Securities
are convertible into), and until such time as the same is no longer required under
applicable requirements of the U.S. Securities Act or applicable state Securities laws,
the certificates representing the Securities may bear a legend in substantially the
following form:
| |
“THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES
ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR ANY STATE SECURITIES
LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE
COMPANY THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY
(A) TO THE COMPANY, (B) PURSUANT TO THE EXEMPTION FROM REGISTRATION UNDER THE
U.S. SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER, IF APPLICABLE, AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS OR (C) WITH THE PRIOR WRITTEN CONSENT OF THE
COMPANY, PURSUANT TO ANOTHER APPLICABLE EXEMPTION UNDER THE U.S. SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS. |
| |
DELIVERY
OF THIS CERTIFICATE MAY NOT CONSTITUTE GOOD DELIVERY IN SETTLEMENT OF TRANSACTIONS ON
STOCK EXCHANGES IN CANADA, AFTER THE EXPIRY OF ANY HOLD PERIOD IN CANADA. A NEW
CERTIFICATE BEARING NO LEGEND, DELIVERY OF WHICH WILL CONSTITUTE GOOD DELIVERY, MAY BE
OBTAINED FROM THE REGISTRAR AND TRANSFER AGENT UPON DELIVERY OF THIS CERTIFICATE AND A
DULY EXECUTED DECLARATION, IN A FORM SATISFACTORY TO THE REGISTRAR AND TRANSFER AGENT AND
THE COMPANY TO THE EFFECT THAT THE SALE OF THE SECURITIES REPRESENTED HEREBY IS BEING MADE
IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT.” |
4.4 The Lender further understands
and acknowledges that the Company has not covenanted to register the Securities (or any
underlying securities which those securities are convertible into) under the U.S.
Securities Act and that absent registration, the Securities (or any underlying securities
which those Securities are convertible into) may not be offered for sale, sold or
otherwise transferred or assigned, directly or indirectly, in the United States or to a
U.S. Person unless:
| |
(a) |
the sale is to the Company; |
| |
(b) |
the sale is made pursuant to the exemption from registration under the U.S.
Securities Act provided by Rule 144 thereunder, if applicable, and in accordance
with applicable state securities laws; |
| |
(c) |
with the prior written consent of the Company, the sale is made pursuant to
another applicable exemption from registration under the U.S. Securities Act and
any applicable state securities laws; or |
| |
(d) |
such Securities have been registered and/or qualified as the case may be under
all applicable United States federal and state securities laws |
5.Closing of Purchase
5.1 The completion of the
subscription contemplated under this Agreement shall occur on a date (the “Closing
Date”) chosen by the Company, but no later than the date prescribed by the TSX,
subject to any extension approved by the TSX. On or before the Closing Date, the Company
shall deliver to the Lender (as per the “Delivery Instructions” below), a
certificate or certificates representing Note. Upon doing so, the Company shall be
entitled to retain the Loan Funds as full payment for the Securities without any further
instructions from, or notice to, the Lender.
6. Payment and Delivery
6.1 The Loan Funds shall be delivered
to the Company directly by wire transfer, certified cheque, bank draft or solicitors trust
cheque payable to the Company.
7. General
7.1 For the purposes of this Agreement, time is of the essence.
7.2 The parties hereto shall execute
and deliver all such further documents and instruments and do all such acts and things as
may, either before or after the execution of this Agreement, be reasonably required to
carry out the full intent and meaning of this Agreement.
7.3 The Lender hereby authorizes the
Company to correct any minor errors in, or complete any minor information missing from,
any document which has been executed by the Lender and delivered to the Company with
respect to this subscription.
7.4 This Agreement shall be subject
to, governed by and construed in accordance with the laws of British Columbia.
7.5 This Agreement may not be assigned by either party hereto.
7.6 This Agreement may be signed by the parties in counterpart and by fax.
SCHEDULE “B”
TO BE COMPLETED BY THE
LENDER:
A. Subscription Amount.
Loan Funds: Cdn.$_150,075____________
| B. |
Name and Address (Note: Cannot be a U.S. Address) The name and address
(to establish the Lender’s jurisdiction of residence for the purpose of
determining the applicable Securities Rules) of the Lender is as follows: |
Leede Financial Markets Inc. In Trust for Xxxxxxx X. Xxxxx #074-0470-S
Name
0000 00xx Xxx. S.W._________________________
Street Address
________________________________________
Xxxxxx Xxx, XX, X0X 4N7____________________
City, Province, Country, Postal Code
Email: x@xxxxxxx.xxx
Phone: 000-000-0000 Fax: 000-000-0000
| C. |
Registration Instructions (Note: Cannot be a U.S. Address) The name and
address of the person in whose name the Lender’s Securities are to be
registered is as follows (if the name and address is the same as was inserted in
paragraph B above, then insert “see B above”): |
_See B Above_____________________________
Name
________________________________________
Xxxxxx Xxxxxxx
________________________________________
________________________________________
City, Province, Country, Postal Code
| D. |
Delivery Instructions (Note: Cannot be a U.S. Address) The name and
address of the person to whom the certificates representing the Lender’s
Securities referred to in paragraph B above are to be delivered is as follows
(if the name and address is the same as was inserted in paragraph B or C above,
then insert “see B above” or “see C above”, as the case may
be): |
_See B Above_____________________________
Name
________________________________________
Xxxxxx Xxxxxxx
________________________________________
________________________________________
City, Province, Country, Postal Code
| E. |
Exemption Relied Upon. The Lender represents to the Company that the
Lender is (tick one or more of the following boxes): |
(i) a director, senior officer* or control person* of the Corporation or of an affiliate* of the
Corporation: [ ]
(ii) a spouse, parent, grandparent, brother, sister or child of a director, senior officer* or control
person* of the Corporation or an affiliate* of the Corporation, being: [ ]
(iii) a parent, grandparent, brother, sister or child of the spouse of a director, senior officer* or
control person* of the Corporation or of an affiliate* of the Corporation., being:
(iv) a close personal friend of a director, senior officer* or control person* of the Corporation or an
affiliate* of the Corporation, being (complete (1) below): [ ]
(v) a close business associate of a director, senior officer* or control person* of the Corporation or
an affiliate* of the Corporation, being (complete (1) below): [ ]
(vi) a founder* of the Corporation or a spouse, parent, grandparent, brother, sister, child, close
personal friend or close business associate of a founder* of the Corporation, being (complete (1) below): [ ]
(vii) a parent, grandparent, brother, sister or child of the spouse of a founder* of the Corporation,
being : [ ]
(viii) a person or company of a which a majority of the voting securities are beneficially owned by, or a
majority of the directors are, persons or companies described in paragraphs (i) to (vii), being
(complete (1) below, if applicable): [ ]
(ix) a trust or estate of which all of the beneficiaries or a majority of the trustees are persons or
companies described in paragraphs (i) to (vii), being
(complete (1) below, if applicable): [ ]
(x) an accredited investor* (complete (2) below):
*See the definitions in Schedule
“D” to this Agreement.
(1) If you are a close personal friend or close business associate of a director, senior officer or control
person of the Company, please indicate how long you have known the individual and describe the nature of
your relationship, including how you are in a position to assess the capabilities and trustworthiness of
the individual.
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
(2) If you are an accredited investor, please describe how you qualify based on the definition in Schedule
"B" to this Agreement.
Paragraph K
Description of Qualifications $1,000,000 net assets
_________________________________________________________________________
_________________________________________________________________________
| F. |
Relationship To Listed Company. State if the Lender is an
“insider” of Voice Mobility International, Inc., being a director,
officer or senior employee of Voice Mobility International, Inc. or of a
subsidiary, or a shareholder holding not less than 10% of the current issued
share capital of Voice Mobility International, Inc. prior
to this purchase: |
No: __X__ Yes: ____
Does the Lender own any securities
of Voice Mobility International, Inc. at the date hereof, if so, give
particulars. State the number of securities of Voice Mobility International, Inc.
held by the Lender not including this purchase:
No:
____ Yes: _X_; if “ Yes”, then:>
| |
___________
common shares, warrants to acquire ___________ common shares, stock options to acquire
___________ common shares and convertible debentures convertible into _________ common
shares and (if applicable, describe any other securities held) the following: |
G.
Accredited Investor. Please indicate each category of accredited
investor that you, the Lender, satisfy, by initialling on the appropriate
line(s) below:
_____ Category 1. A bank as defined in Section 3(a)(2) of the U.S. Securities Act whether acting in its
individual or fiduciary capacity; or
_____ Category 2. A savings and loan association or other institution as defined in Section 3(a)(5)(A)
of the U.S. Securities Act, whether acting in its individual or fiduciary capacity; or
_____ Category 3. A broker or dealer registered pursuant to Section 15 of the U.S. Exchange Act, as
amended; or
_____ Category 4. An insurance company as defined in Section 2(13) of the U.S. Securities Act; or
_____ Category 5. An investment company registered under the U.S. Investment Company Act of 1940; or
_____ Category 6. A business development company as defined in Section 2(1)(48) of the U.S. Investment
Company Act of 1940; or
_____ Category 7. A small business investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the U.S. Small Business Investment Act
of 1958; or
_____ Category 8. A plan established and maintained by a state, its political subdivisions or any
agency or instrumentality of a state or its political subdivisions, for the benefit
of its employees, with total assets in excess of U.S.$5,000,000; or
_____ Category 9. An employee benefit plan within the meaning of the U.S. Employee Retirement Income
Security Act of 1974, if the investment decision is made by a plan fiduciary, as
defined in Section 3(21) of such Act, which is either a bank, savings and loan
association, insurance company or registered investment advisor, or an employee
benefit plan with total assets in excess of U.S.$5,000,000 or, if a self-directed
plan, the investment decisions are made solely by persons who are Accredited
Investors; or
_____ Category 10. A private business development company as defined in Section 202(a)(22) or the U.S.
Investment Advisers Act of 1940; or
_____ Category 11. An organization described in Section 501(c)(3) of the U.S. Internal Revenue Code, a
corporation, a Massachusetts or similar business trust, or a partnership, not formed
for the specific purpose of acquiring the Shares, with total assets in excess of
U.S.$5,000,000; or
_____ Category 12. A director, executive officer or general partner of the Company.
__X___ Category 13. A natural person whose individual net worth(*), or joint net worth with that person's
spouse, at the time of his purchase exceeds U.S.$1,000,000; or
_____ Category 14. A natural person who had an individual income(*) in excess of U.S.$200,000 in each of
the two most recent years or joint income with that person's spouse in excess of
U.S.$300,000 in each of those years and has a reasonable expectation of reaching the
same income level in the current year; or
_____ Category 15. A trust, with total assets in excess of U.S.$5,000,000, not formed for the specific
purpose of acquiring the securities offered, whose purchase is directed by a
sophisticated person as described under the U.S. Securities Act Rule 506(b)(2)(ii); or
_____ Category 16. An entity in which all of the equity owners are Accredited Investors.
| |
* |
For the purposes of this Agreement, the term “net worth” means the excess of
total assets over total liabilities. In determining income, an investor should add to his
or her adjusted gross income any amounts attributable to the tax exempt income received,
losses claimed as a limited partner in any limited partnership, deductions claimed for
depletion, contributions to an Individual Retirement Account or Xxxxx retirement plan,
alimony payments and any amount by which income from long-term capital gains has been
reduced in arriving at adjusted gross income. |
If Category 3 and/or 11 is marked,
please indicate by marking an “X” in the appropriate space whether the Lender is
a corporation that has a net worth on a consolidated basis according to its most recent
audited financial statements of not less than U.S.$14,000,000.
Yes No
TO BE COMPLETED AND
SIGNED BY THE LENDER:
SIGNED, SEALED AND DELIVERED BY:
Leede Financial Markets Inc. In
Trust for Xxxxxxx X. Xxxxx #074-0470-S
Name of the “Lender” —
use the name inserted in paragraph B above.
Per:
Signature
of Lender
Title
(if applicable)
SCHEDULE “C”
UNLESS PERMITTED UNDER SECURITIES
LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE OCTOBER 18,
2004.
THE SECURITIES REPRESENTED HEREBY
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
“U.S. SECURITIES ACT”) OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY
PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE COMPANY THAT SUCH SECURITIES MAY
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY, (B) PURSUANT
TO THE EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER, IF APPLICABLE, AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS OR
(C) WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY, PURSUANT TO ANOTHER APPLICABLE
EXEMPTION UNDER THE U.S. SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
DELIVERY OF THIS CERTIFICATE MAY
NOT CONSTITUTE GOOD DELIVERY IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA,
AFTER THE EXPIRY OF ANY HOLD PERIOD IN CANADA. A NEW CERTIFICATE BEARING NO LEGEND,
DELIVERY OF WHICH WILL CONSTITUTE GOOD DELIVERY, MAY BE OBTAINED FROM THE REGISTRAR AND
TRANSFER AGENT UPON DELIVERY OF THIS CERTIFICATE AND A DULY EXECUTED DECLARATION, IN A
FORM SATISFACTORY TO THE REGISTRAR AND TRANSFER AGENT AND THE COMPANY TO THE EFFECT THAT
THE SALE OF THE SECURITIES REPRESENTED HEREBY IS BEING MADE IN COMPLIANCE WITH RULE 904 OF
REGULATION S UNDER THE U.S. SECURITIES ACT
VOICE MOBILITY
INTERNATIONAL, INC.
CONVERTIBLE PROMISSORY
NOTE
Principal Amount: Cdn.$150,075 Effective Date: June 17,
2004
1. Promise to Pay
1.1 FOR VALUE RECEIVED, Voice
Mobility International, Inc. (the "Company"), a company with a business office at Xxxxx
000, 0000 Xxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxx Xxxxxxxx X0X 0X0, acknowledges itself
indebted and promises to pay, on demand, to the order of Leede Financial Markets Inc.
in trust for Xxxxxxx Xxxxx RRSP #074-0470-S (the "Holder") the sum of $150,075 (the
"Principal") in lawful money of Canada, plus simple interest accruing from the
Effective Date until repaid at the rate of 8% per annum, such interest being payable
quarterly in arrears (the "Interest").
2. Due Date
2.1 Unless previously
converted under Section 3 hereof, this Promissory Note (the "Note") shall become due
and payable as to both accrued Interest and Principal at any time on or after June 17,
2006 (the "Due Date") upon receipt by the Company of written notice from the Holder
demanding such payment. All payments hereunder shall be credited, first, to accrued
and unpaid Interest, and second, outstanding Principal and shall be without set-off or
counterclaim and without deduction or withholding for any taxes. All payments
hereunder shall be made to the Holder at the address as may be designated by the Holder
from time to time.
3. Conversion
3.1 The Holder shall, in his
sole discretion, have the right at any time prior to Due Date to convert the Principal
outstanding under this Note into that number of units (a "Unit") of the Company as is
determined by dividing the unpaid Principal then due on this Note by a price of
Cdn.$1.15 per Unit. Each Unit shall consist of one common share of the Company (the
"Note Shares") and one common share purchase warrant in a form to be provided by
the Company (the "Warrant") that shall entitle the Holder, upon giving 61 days notice
to the Company, to purchase one Share (the "Warrant Shares") of the Company at a
purchase price of Cdn.$1.15 per Share for a period of two years from the Effective
Date.
3.2 If the Holder wishes to
exercise the conversion rights as aforesaid it shall deliver to the Company at its
head office being Xxxxx 000, 0000 Xxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxx Xxxxxxxx X0X
0X0, notice in writing of such exercise, naming the number of Warrant Shares
represented by the Warrant and the number of Note Shares to be issued and person or
persons in whose name or names such Note Shares are to be registered. No
additional consideration will be required from the Holder in order to exercise the
right to convert this Note. The Company will pay all fees on account of any security
transfer tax or transfer agent fee which may be required to effect the issue of the
Warrant and the Note Shares to the registered holder hereof. Upon delivery of the
notice of exercise to the Company, the Company shall immediately issue and deliver or
cause to be issued and delivered to the Holder a certificate or certificates
representing the Note Shares and Warrant issued and upon such delivery the person or
persons designated in the said notice shall be deemed for all purposes the holder
of record of fully paid common shares in the capital stock of the Company in the number
designated in such notice.
3.3 In the event of any
subdivision, revision or change of the common shares of the Company at any time
while this Note is outstanding into a greater or lesser number of common shares, the
Company shall deliver at the time of the exercise thereafter of the right of conversion
by the Holder such additional or lesser number of Note Shares as would have resulted
from such subdivision, redivision or change if the right of conversion had been
exercised prior to the date of such subdivision, redivision or change of Note Shares.
4. Default
4.1 Any one or more of the
following shall constitute an "Event of Default" as the term is used herein:
|
(a) |
if
the Company makes default in the observance or performance of any written covenant
or undertaking given by the Company to the Holder and such default is
not rectified within 15 business days of notice being delivered by
the Holder to the Company; |
|
(b) |
if
the Company makes default in payment of any indebtedness or liability of the Company
to the Holder hereunder, when due; |
|
(c) |
any
representation or warranty in any written statement or certificate furnished by the
Company to the Holder at the time of the making of this Note or at any
time in respect of this Note is untrue or misleading in any
material respect and such default continues for a period of 15 business
days after written notice thereof by the Holder to the Company; |
|
(d) |
if
an order is made or a resolution passed for the winding-up of the Company; |
|
(e) |
if
the Company becomes insolvent, commits any act of bankruptcy or makes an authorized
assignment or bulk sale of its assets; |
|
(f) |
if
any proceedings with respect to the Company are commenced: (i) under the
Companies Creditors Arrangement Act (Canada) or any other
bankruptcy, insolvency or analogous laws, (ii) issuing
sequestration or process of execution against, or against any
substantial part of, the property of the Company, or (iii)
appointing a receiver of the Company or any substantial part of its
property, or ordering the winding-up or liquidation of its affairs,
and such proceedings are consented to by the Company or not
dismissed within 60 days after commencement; |
|
(g) |
if
any one or more of a trustee, receiver and manager, custodian, liquidator or other
person with similar powers is appointed for the Company or for
any part of its property and is not discharged within 30 days of
such appointment; or |
|
(h) |
if
an encumbrancer takes lawful possession of any portion of the property of the
Company which is material to the Company taken as a whole, or if
any process of execution is levied or enforced upon or against a
material portion of the property of the Company and remains unsatisfied for
such period as would permit any such property to be sold
thereunder, unless the Company actively and diligently contests
in good faith such process, but in that event the Company shall,
if the Holder so requires, give security which, in the discretion of the Holder,
is sufficient to pay in full the amount thereby claimed in case the
claim is held to be valid. |
4.2 When any Event of Default
has occurred, the Company shall give written notice to the Holder within five business
days of such Event of Default. When any Event of Default has occurred and is
continuing, the Holder may, by notice in writing delivered to the Company, declare
the entire Principal amount of this Note, together with all accrued and unpaid
Interest hereunder immediately due and payable without any presentment, demand,
protest or other notice of any kind, all of which are hereby expressly waived by the
Company.
4.3 Upon the occurrence of an
Event of Default, and at any time thereafter unless and until such Event of Default
has been waived by the Lender or cured to the satisfaction of the Lender, the Lender
shall, by written notice to the Company take any of the following actions:
|
(a) |
Acceleration.
Declare the unpaid Principal of and any accrued Interest in respect of the Note and
any and all other obligations of any and every kind owing by the
Company to the Lender under any Security Document ("Security
Documents" refer to the guarantee agreement (the "Guarantee
Agreement") entered into between the Lender and Voice Mobility Inc.
(the "Guarantor") and the general security agreement entered into
between the Lender and the Company, to be due whereupon the same shall
be immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Company; and |
|
(b) |
Enforcement
of Rights. Enforce any and all rights and interests created and existing under the
Security Documents and all rights of set-off. |
4.4 Notwithstanding the
foregoing, if an Event of Default specified in Section "4.1" shall occur, then all
obligations owing to the Holder hereunder shall automatically and immediately become
due and payable without the giving of any notice or other action by the Holder.
5. General
5.1 The Holder shall not assign
any of its rights or obligations hereunder without the prior written consent of the
Company, which consent is not to be unreasonably withheld. Upon surrender to the
Company of this Note for partial transfer, the Holder shall be entitled to receive,
without expense to the Holder, one or more new Notes representing the portion of the
Note which is not transferred. This Note shall be binding upon the Company and its
successors and assigns including any successor by reason of amalgamation of or
any other change in the Company and shall enure to the benefit of the Holder and his
successors and assigns. The Company shall not assign any of its rights or
obligations hereunder without the prior written consent of the Holder, which consent
is not to be unreasonably withheld.
5.2 The Company agrees to
remain fully bound until this Note shall be fully paid and waives demand,
presentment and protest, and all notices hereto, including notice of dishonour, and
further agrees to remain bound, notwithstanding any extension, modification, waiver,
or other indulgence or discharge or release of any obligor hereunder. No failure to
accelerate the debt evidenced hereby, and no indulgence that may be granted from
time to time, shall be construed: (i) as a novation of this Note or as a reinstatement
of the indebtedness evidenced hereby or as a waiver of such right of acceleration or
of the right of the Holder thereafter to insist upon strict compliance with the terms
of this Note, or (ii) to prevent the exercise of such right of acceleration or any other
right granted hereunder or by law. No extension of time for the payment of this Note
shall operate to release, discharge, modify, change or affect the original liability
of the Company under this Note, either in whole or in part, unless the Holder agrees
otherwise in writing. No modification or indulgence by the Holder shall be binding
unless in writing.
5.3 If one or more of the
provisions contained herein shall be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby.
All references to currency herein
mean the lawful money of Canada. This Note shall be construed, governed and enforced
in accordance with the laws of the Province of British Columbia and the federal
laws of Canada applicable therein.
VOICE MOBILITY INTERNATIONAL, INC.
Per: _______________________________
SCHEDULE “D”
DEFINITIONS
“accredited
investor” means
| (a) |
a Canadian financial institution (as defined in National Instrument 14-101
Definitions), or an authorized foreign bank listed in Schedule III of the
Bank Act (Canada), |
| (b) |
the Business Development Bank of Canada incorporated under the Business
Development Bank of Canada Act (Canada), |
| (c) |
an association under the Cooperative Credit Associations Act (Canada)
located in Canada or a central cooperative credit society for which an order has
been made under subsection 473(1)of that Act, |
| (d) |
a subsidiary of any person or company referred to in paragraphs (a) to (c), if
the person or company owns all of the voting securities of the subsidiary,
except the voting securities required by law to be owned by directors of that
subsidiary, |
| (e) |
a person or company registered under the securities legislation, or under the
securities legislation of another jurisdiction of Canada, as an adviser or
dealer, other than a limited market dealer registered under the Securities
Act (Ontario) or the Securities Act (Newfoundland and Labrador), |
| (f) |
an individual registered or formerly registered under the securities legislation
of a jurisdiction of Canada, as a representative of a person or company referred
to in paragraph (e), |
| (g) |
the government of Canada or a jurisdiction of Canada, or any crown corporation,
agency or wholly-owned entity of the government of Canada or a jurisdiction of
Canada, |
| (h) |
a municipality, public board or commission in Canada, |
| (i) |
any national, federal, state, provincial, territorial or municipal government of
or in any foreign jurisdiction, or any agency of that government, |
| (j) |
a pension fund that is regulated by either the Office of the Superintendent of
Financial Institutions (Canada) or a provincial pension commission or similar
regulatory authority of a jurisdiction of Canada, |
| (k) |
an individual who, either alone or with a spouse, beneficially owns, directly or
indirectly, financial assets having an aggregate realizable value that before
taxes, but net of any related liabilities exceeds Cdn $1,000,000, |
| (l) |
an individual whose net income before taxes exceeded Cdn.$200,000 in each of the
two most recent years or whose net income before taxes combined with that of a
spouse exceeded Cdn.$300,000 in each of the two most recent years and who, in
either case, reasonably expects to exceed that net income level in the current
year, |
| (m) |
a person or company, other than a mutual fund or non-redeemable investment fund,
that, either alone or with a spouse, has net assets of at least Cdn. $5,000,000,
and unless the person or company is an individual, that amount is shown on its
most recently prepared financial statements, |
| (n) |
a mutual fund or non-redeemable investment fund that, in the local jurisdiction,
distributes its securities only to persons or companies that are accredited
investors, |
| (o) |
a mutual fund or non-redeemable investment fund that, in the local jurisdiction,
is distributing or has distributed its securities under one or more prospectuses
for which the regulator has issued receipts, |
| (p) |
a trust company or trust corporation registered or authorized to carry on
business under the Trust and Loan Companies Act (Canada) or under
comparable legislation in a jurisdiction of Canada or a foreign jurisdiction,
trading as a trustee or agent on behalf of a fully managed account, |
| (q) |
a person or company trading as agent on behalf of a fully managed account if
that person or company is registered or authorized to carry on business under
the securities legislation of a jurisdiction of Canada or a foreign jurisdiction
as a portfolio manager or under an equivalent category of adviser or is exempt
from registration as a portfolio manager or the equivalent category of adviser, |
| (r) |
a registered charity under the Income Tax Act (Canada) that, in regard to
the trade, has obtained advice from an eligibility adviser or other adviser
registered to provide advice on the securities being traded, |
| (s) |
an entity organized in a foreign jurisdiction that is analogous to any of the
entities referred to in paragraphs (a) through (e) and paragraph (j) in form and
function, or |
| (t) |
a person or company in respect of which all of the owners of interests, direct
or indirect, legal or beneficial, except the voting securities required by law
to be owned by directors, are persons or companies that are accredited
investors. |
“affiliate” shall
mean the following:
| |
(a) |
one corporation is affiliated with another corporation if one of them is the
subsidiary of the other, or both are subsidiaries of the same corporation, or
each of them is controlled by the same person; |
| |
(b) |
a corporation is a subsidiary of another corporation if: a. it is controlled by
i. that other corporation, |
| |
ii. |
that other corporation and one or more corporations, each of which is controlled
by that other corporation, or |
| |
iii. |
two or more corporations, each of which is controlled by that other corporation,
or b. it is a subsidiary of a subsidiary of that other corporation. (c) For the
purposes of subsections (a) and (b), a corporation is controlled by a person if:
a. shares of the corporation carrying more than 50% of the votes for the
election of directors are held,other than by way of security only, by or for the benefit of that person, and |
| |
b. |
the
votes carried by the shares mentioned in paragraph (i) are sufficient, if
exercised, to elect a majority of the
directors of the corporation. |
“control
person” means
| (a) |
a person who holds a sufficient number of the voting rights attached to all
outstanding voting securities of the Corporation to affect materially the
control of the Corporation, or |
| (b) |
each person in a combination of persons, acting in concert by virtue of an
agreement, arrangement, commitment or understanding, which holds in total a
sufficient number of the voting rights attached to all outstanding voting
securities of the Corporation to affect materially the control of the issuer, |
| (c) |
and, if a person or combination of persons holds more than 20% of the voting
rights attached to all outstanding voting securities of the Corporation, the
person or combination of persons is deemed, in the absence of evidence to the
contrary, to hold a sufficient number of the voting rights to affect materially
the control of the Corporation. |
“financial assets”
means cash and securities.
“founder”, in
respect of the Corporation, means a person or company who,
| (a) |
acting alone, in conjunction or in concert with one or more other persons or
companies, directly or indirectly, takes the initiative in founding, organizing
or substantially reorganizing the business of the Corporation; and |
| (b) |
at the time of the proposed trade, is actively involved in the business of the
Corporation. |
“related
liabilities” means
| (a) |
liabilities incurred or assumed for the purpose of financing the acquisition or
ownership of financial assets, or |
| (b) |
liabilities that are secured by financial assets. |
“senior
officer” means
| (a) |
the chair or a vice chair of the board of directors, the president, a vice
president, the secretary, the treasurer or the general manager of the
Corporation, |
| (b) |
any individual who performs functions for a person similar to those normally
performed by an individual occupying any office specified in paragraph (a), and |
| (c) |
the 5 highest paid employees of the Corporation, including any individual
referred to in paragraph (a) or (b) and excluding a commissioned salesperson who
does not act in a managerial capacity. |
SCHEDULE “E”
TORONTO STOCK EXCHANGE
FORMS
PRIVATE PLACEMENT
QUESTIONNAIRE AND UNDERTAKING
To be completed by each proposed
private placement Lender of listed securities or securities which are convertible into
listed securities.
QUESTIONNAIRE
1. DESCRIPTION OF
TRANSACTION
(a)
Name of issuer of the Securities:
Voice
Mobility International, Inc.
(b)
Number and Class of Securities to be Purchased:
| |
The
Company proposes to issue a promissory note for a face value of $150,075 (the
“Financing”) with an annual coupon rate of eight percent, payable quarterly,
convertible at the option of the holder at any time before the due date, which is two
years from the closing of the Financing, into 130,500 units (a “Unit”) at a
price of Cdn.$1.15 per Unit. Each Unit consists of one common share of the Company and one
common share purchase warrant. One warrant entitles the holder, upon giving 61 days notice
to the Company, to purchase one common share of the Company at a purchase price of
Cdn.$1.15 per common share for a period of two years from the closing of the Financing. |
(c)
Purchase Price: Cdn.$150,075
2. DETAILS OF LENDER
(a) Name of Lender:
Leede Financial Markets Inc in trust for
Xxxxxxx X. Xxxxx RRSP#074-0470-S
(b) Address:
2300 - 777 8th Avenue S.W.____________
Calgary, Alberta_____________________
T2P 3R5
(c) Names and address of
persons having a greater than 10% beneficial interest in the Lender:
None 3. RELATIONSHIP TO ISSUER
| |
(a) |
Is the Lender (or any person named in response to 2(c) above) an insider of the
Issuer for the purposes of the Ontario Securities Act (before giving effect to
this private placement)? If so, state the capacity in which the Lender (or
person named in response to 2(c)) qualifies as an insider: |
| |
Director: Senior
Officer: |
| |
Senior
Employee: Greater
than 10% Shareholder: |
| |
(b) |
If the answer to (a) is “no”, are the Lender and the Issuer controlled
by the same person or company? If so, give details: |
No: __X___ Yes: _____; if "Yes", then: _______________________________________
4. DEALINGS OF LENDER IN
SECURITIES OF THE ISSUER
| |
Give
details of all trading by the Lender, as principal, in the securities of the Issuer (other
than debt securities which are not convertible into equity securities), directly or
indirectly, within the 60 days preceding the date hereof:
|
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
UNDERTAKING
TO: THE TORONTO STOCK EXCHANGE
The undersigned has subscribed for
and agreed to purchase, as principal, the Securities described in Item 1 of this Private
Placement Questionnaire and Undertaking.
The undersigned undertakes not to
sell or otherwise dispose of any of the said Securities so purchased or any securities
derived therefrom for a period of four months from the date of the closing of the
transaction herein or for such period as is prescribed by applicable securities
legislation, whichever is longer, without the prior consent of The Toronto Stock Exchange
and any other regulatory body having jurisdiction.
DATED at
_______________________________, this _____ day of ___________ , 2004.
Leede Financial Markets Inc in trust for
Xxxxxxx X. Xxxxx RRSP#074-0470-S
(Name of Lender - please print)
(Authorized Signature)
(Official capacity - please print)
(Please print name of individual whose signature
appears above, if different from name of
Lender printed above)
SCHEDULE “F”
